The Marketing

Environment
Objectives
 Know the environmental forces that affect the
company’s ability
to serve its customers.
 Realize how changes in the demographic and
economic environments affect marketing decisions.
 Identify the major trends in the firm’s natural and
technological environments.
 Know the key changes in the political and cultural
environments.
 Understand how companies can react to the
marketing environment.
Key Environments
 Marketing Environment
 The actors and forces that affect a firm’s
ability to build and maintain successful
relationships with customers.
 Aspects of the marketing environment:
 Micro-environment
 Macro-environment
Micro environment
 Competitors
 Publics
 Marketing Intermediaries
Micro environment
 Departments within the company
impact marketing planning.
 Suppliers help create and deliver
customer value.
 Treat suppliers as partners.
 Marketing intermediaries help sell,
promote, and distribute goods.
 Intermediaries take many forms.
Types of Publics
 Financial
 Media
 Government
 Local
 General
 Internal
 Citizen Action
The Macro-environment
 Demographic
 Economic
 Natural
 Technological
 Political
 Cultural
Macro-environment
 Key Demographic Trends
 World population growth
 Changing age structure
 The U.S. population consists of seven
generational groups.
 Baby boomers, Generation X, and
Generation Y are key groups.
 Distinct segments typically exist within
these generational groups.
Key Generations
 Baby Boomers  Born between 1946 and
 Generation X 1964
 Generation Y  Represent 28% of the
population; earn 50% of
personal income
 Many mini-segments exist
within the boomer group
 Entering peak earning years
as they mature
 Lucrative market for travel,
entertainment, housing, and
more
Key Generations
 Baby Boomers  Born between 1965 and
 Generation X 1976
 Generation Y  First latchkey children
 Maintain a cautious
economic outlook
 Share new cultural
concerns
 Represent $125 billion
in annual purchasing
power
 Will be primary buyers
of most goods by 2010
Key Generations
 Baby Boomers  Born between 1977 and
1994
 Generation X
 72 million strong; almost as
 Generation Y large a group as their baby
boomer parents
 New products, services, and
media cater to GenY
 Computer, Internet and
digitally saavy
 Challenging target for
marketers
Macro-environment
 Key Demographic Trends
 Changing households

 Geographic population shifts

 Better-educated, more white-collar workforce

 Increasing Diversity

 The Economic Environment

 Consumer purchasing power and spending patterns.

 Two types of national economies: subsistence vs. industrial.

 Consumers spend carefully and desire greater value.

Macro-environment
 Key Economic Trends
 India’s income distribution
 Upper class
 Large working middle class – buying capacity
 Consumer spending patterns are changing.
 Key Technological Trends
 The technological environment is characterized by
rapid change.
 New technologies create new opportunities and
markets but make old technologies obsolete
Macro-environment
 The Political Environment
 Includes laws, governmental agencies, and
pressure groups that impact organizations and
individuals. Key trends include:
 Increased legislation to protect businesses
as well as consumers.
 Changes in governmental agency enforcement.
 Increased emphasis on ethical behavior and
social responsibility
Macro-environment
 The Cultural Environment
 Is composed of institutions and other
forces that affect a society’s basic values,
perceptions, preferences, and behaviors.
 Culture can influence decision making.
 Core beliefs are persistent; secondary cultural
values change and shift more easily.
 The cultural values of a society are expressed
through people’s views.
Responding to the Marketing
Environment
 Reactive: Passive Acceptance and
Adaptation
 Companies design strategies that avoid
threats and capitalize upon opportunities.
 Proactive: Environmental Management
 Use of lobbyists, PR, advertorials, lawsuits,
complaints, and contractual agreements to
influence environmental forces.